They didn’t increase their supply. They decided to include residential demand deposits and prepaid funds received by nonbank payment institutions into M1 calculations, starting in 2025.
Discussion
Correct.
China’s monetary supply increase is incoming.
I think it will be the primary driver of global M2 acceleration in the coming quarters.
It was already ramping up. The same thing happened when the US changed their definition of M1. It obscured a real expansion with a fake one.